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New Haven County residents Janine and Gerard Carbonaro, of Oxford, agreed to pay 169,563.60 as part of an agreement for fraudulently misspending $109,000 in small business loans during the pandemic to purchase new property in Florida.
US Attorney Leonard Boyle said that on April 7, 2020, Gerard Carbonaro applied for an Economic Injury Disaster Loan and Grant/Advance on behalf of Janine Carbonaro as sole proprietor for Hair Attraction Design Team, a hair salon located in Monroe in Fairfield County.
The loan documents required Janine Carbonaro to “use all the proceeds of this Loan solely as working capital to alleviate the economic injury” caused by COVID-19.
Boyle said that the Carbonaros did not use the proceeds of the loan as working capital for Hair Attraction Design Team.
Instead, they used the proceeds to pay off the mortgage of a residential property in Florida, and to purchase an additional residential property in Florida for personal investment purposes.
“The Justice Department and our federal investigative partners continue to uncover those who violated the terms of CARES Act business loan programs and misused the funds they received, and we are committed to pursuing civil or criminal penalties against wrongdoers,” Boyle said.
As part of their agreement, Boyle noted that the Carbonaros also agreed to withdraw a pending application for a loan increase.
“These individuals, motivated by greed, chose to defraud programs intended to bring relief to those in need,” FBI Special Agent in Charge David Sundberg said. “Justice has prevailed and we will continue to pursue every opportunity to combat COVID relief fraud in the State of Connecticut.”
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